Last year, I had the opportunity to attend an event where a group of 50 of us walked across roughly 10 feet of hot burning coals. It was my first time doing a “fire walk,” which Tony Robbins popularized as an exercise that pushes your mind out of its comfort zone and forces your body to do something you don’t think it can do. For many people, it has been a life changing experience.

Beforehand, I’d done some reading about the science of how a fire walk is possible. Apparently, it has to do with the surface area, density of the type of wood, the moisture on your feet and the relatively short time of contact for each step. Armed with this knowledge, I was ready to take the plunge when my turn arrived.

Right about now you are probably expecting me to share a lesson on the importance of facing your fears and escaping your comfort zone. However, that was not the lesson I learned that day.

The lesson I learned that day was that burning coals are very hot!

Having just watched many people before me reach the other side, and believing that the activity would probably not be acceptable if people were badly injured, I went into my walk expecting it to be far easier than it actually was and thinking it would be a brisk walk to the other side.

But when I took my first step, I actually panicked a bit when I felt how hot the coals were. I did what you aren’t supposed to do—rather than walking at a measured pace, I ran and also lost my balance. When I made it to the other side, my feet were very uncomfortable for the next hour and felt burned even though there was not a visible mark.

This activity was a powerful reminder for me that many of our experiences in life are not objective—most things we experience in reality are heavily affected by our expectations.

This is a phenomenon that I have seen play out in the stock market time and time again over the years. A company that releases terrible earnings can often see its stock price rise, as long as its performance is better than expected. Conversely, a company that reports objectively strong earnings can see its stock tumble if those results are worse than investors expect.

This counterintuitive lesson also applies outside of investing: performance or outcomes are most often judged based on how they compare to expectations, not as isolated events.

For example, in one of my first performance reviews out of college, my manager shared a similar lesson about deadlines. He said if I told him I would have something done by Thursday and gave it to him Friday, he was disappointed, even if he didn’t need it until Monday. Turning my work in on Friday actually beat his deadline, but by promising it Thursday I unnecessarily raised expectations and failed to meet them.

Likewise, my mistake in the fire walk was that, to avoid the reality that hot coals are hot, I adjusted my expectations too far the opposite direction. However, based on how my feet felt for the next few hours, manipulating my expectations didn’t work.

Upon further reflection, here are a few good learnings around managing expectations for ourselves and with others.

For Ourselves

• If we think something may be difficult, our response should not be to avoid reality and set rosy expectations. Instead, we should expect it to be even harder than we think to prepare ourselves for the test.
• Lowering our expectations is often just delaying our discomfort from before the experience to during the experience.

 
With Others

• Make sure expectations are clear and everyone is on the same page about them.
• When setting expectations, aim for the minimum that the other person(s) are willing to accept. Then, you’ll be well positioned to exceed those expectations, and they’ll remember that positively.
• As soon as you realize that underlying circumstances have changed, you should change the expectations in the same direction as soon as possible rather than apologizing after a missed deadline or subpar outcome.

 
We all have places in our life where our expectations are out of alignment. The key is to know where our expectations are too low or too high and adjust accordingly.